Technology, Information and the Decentralization of the Firm / Daron Acemoglu, Philippe Aghion, Claire Lelarge, John Van Reenen, Fabrizio Zilibotti.

By:

Acemoglu, Daron

Contributor(s):

Material type: Text

TextSeries: Working Paper Series (National Bureau of Economic Research) ; no. w12206.Publication details: Cambridge, Mass. National Bureau of Economic Research 2006.Description: 1 online resource: illustrations (black and white)Subject(s):

Online resources:

Available additional physical forms:

Hardcopy version available to institutional subscribers

Abstract: This paper develops a framework to analyze the relationship between the diffusion of new technologies and the decentralization decisions of firms. Centralized control relies on the information of the principal, which we equate with publicly available information. However, the manager can use her informational advantage to make choices that are not in the best interest of the principal. As the available public information about the specific technology increases, the trade-off shifts in favor of centralization. We show that firms closer to the technological frontier, firms in more heterogeneous environments and younger firms are more likely to choose decentralization. Using three datasets of French and British firms in the 1990s we report robust correlations consistent with these predictions.

Tags from this library: No tags from this library for this title. Log in to add tags.

Average rating: 0.0 (0 votes)

Holdings
Item type	Home library	Collection	Call number	Status	Date due	Barcode	Item holds
Working Paper	Biblioteca Digital	Colección NBER	nber w12206 (Browse shelf(Opens below))	Not For Loan

Total holds: 0

Collection: Colección NBER Close shelf browser (Hides shelf browser)

Previous	No cover image available	No cover image available	No cover image available	No cover image available	No cover image available	No cover image available	No cover image available	Next
Previous	nber w12203 Is IPO Underperformance a Peso Problem? /	nber w12204 Intergenerational Risksharing and Equilibrium Asset Prices /	nber w12205 Redistribution by Insurance Market Regulation: Analyzing a Ban on Gender-Based Retirement Annuities /	nber w12206 Technology, Information and the Decentralization of the Firm /	nber w12207 The Academic Achievement Gap in Grades 3 to 8 /	nber w12208 The Effects of State Medicaid Policies on the Dynamic Savings Patterns of the Elderly /	nber w12209 Buy, Lobby or Sue: Interest Groups' Participation in Policy Making - A Selective Survey /	Next

May 2006.

This paper develops a framework to analyze the relationship between the diffusion of new technologies and the decentralization decisions of firms. Centralized control relies on the information of the principal, which we equate with publicly available information. However, the manager can use her informational advantage to make choices that are not in the best interest of the principal. As the available public information about the specific technology increases, the trade-off shifts in favor of centralization. We show that firms closer to the technological frontier, firms in more heterogeneous environments and younger firms are more likely to choose decentralization. Using three datasets of French and British firms in the 1990s we report robust correlations consistent with these predictions.